US trade deficit widens sharply in December; goods trade gap highest on record in 2025

[mahatmakanejeeves]

Source: Reuters

Reuters
US trade deficit widens sharply in December; goods trade gap highest on record in 2025

By Reuters
February 19, 2026 9:34 AM EST * Updated 31 mins ago

WASHINGTON, Feb 19 (Reuters) - The U.S. trade deficit widened sharply in December amid a surge in imports, and the goods shortfall in 2025 was the highest on record despite President Donald Trump's tariffs on foreign manufactured merchandise.

The trade gap ballooned 32.6% to $70.3 billion, the Commerce Department's Bureau of Economic Analysis and Census Bureau said on Thursday. Economists polled by Reuters forecast the trade deficit would contract to $55.5 billion. The trade deficit narrowed 0.2% to $901.5 billion in 2025. The goods trade gap widened 2.1% to an all-time high of $1.24 trillion.

Trump last year unleashed a barrage of tariffs against trading partners with the aim, among other things, to address trade imbalances and protect U.S. industries. But the punitive duties have not yielded a manufacturing renaissance, with factory employment declining by 83,000 jobs from January 2025 through January 2026.

The report was delayed because of last year's government shutdown. Imports increased 3.6% to $357.6 billion in December. Goods imports surged 3.8% to $280.2 billion, boosted by a $7.0 billion increase in industrial supplies and materials, mostly non-monetary gold, copper and crude oil.

{snip}

Read more: https://www.reuters.com/business/us-trade-deficit-widens-sharply-december-goods-trade-gap-highest-record-2025-2026-02-19/

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Hat tip, Joe.My.God.

https://www.joemygod.com/2026/02/commerce-dept-2025-trade-deficit-was-record-1-2t/

[sinkingfeeling]

1. Another TSF failure.

[William Seger]

2. Our Dunning-Kruger president knows more about trade than anyone

"Dumbest trade war in history" according to the Wall Street Journal, but they're not smart like #rump.

[wolfie001]

5. Those fuckers that helped install him

Fucking monsters.

[Ol Janx Spirit]

3. These reports have been stubbornly better than I thought they would be going in...

...to this tariff regime.

Exports fell 1.7% to $287.3 billion in December. Goods exports dropped 2.9% to $180.8 billion, weighed down by an $8.7 billion decline in industrial supplies and materials, mostly non-monetary gold. Exports of other goods fell.

But capital goods exports increased, boosted by semiconductors. There were increases in exports of consumer goods, including pharmaceutical preparations. Exports of goods increased 5.7% to an all-time high of $2.20 trillion in 2025, boosted by capital goods, industrial supplies and materials, other goods as well as consumer goods.

...

The economy likely grew at a 3.0% annualized rate last quarter after expanding at a 4.4% pace in the July-September quarter, a Reuters survey of economists showed.

https://www.reuters.com/business/us-trade-deficit-widens-sharply-december-goods-trade-gap-highest-record-2025-2026-02-19/

This is part of the reason that Blondie Bondi can shrilly scream about the DOW being high, and a reason that the Administration uses as an indication that the economy is actually doing well.

Trade deficits act as a direct subtraction in the GDP formula, so the fact that the GDP number is still pretty robust even with these trade deficits indicates that the economy is still doing pretty well--which is surprising given the massive tax increase in the form of tariffs and the extreme reduction of the labor force through both immigration policy and the slashing of government jobs (assuming we can believe the numbers we are getting.) Of course, well for whom is part of the rub...but still....

Thus far, the single horsehair holding the Sword of Damocles over our economy has managed to not break.

How long will or can that continue?

[BaronChocula]

4. What a difference a few months make

The U.S. trade deficit six months into President Donald Trump’s tariffs tumbled to its lowest level since mid-2009, the Commerce Department reported Thursday.

With exports rising and imports falling, the trade shortfall was just $29.4 billion for October, down 39% from the prior month. Exports increased 2.6% while imports slipped 3.2%.

The total was the lowest since the second quarter of 2009 as the U.S. was just coming out of the financial crisis and the Great Recession.

https://www.cnbc.com/2026/01/08/trade-deficit-in-october-hits-smallest-since-2009-after-trumps-tariff-moves.html

[Yo_Mama_Been_Loggin]

6. Heckuva job Trumpy

Everything Trump touches dies.

[Prairie Gates]

7. The Wall Street consensus is that the economy has been "surprisingly resilient" vis-a-vis tariffs

What this data tells us is that everybody is playing a wait-and-see game with SCOTUS, either anticipating that tariffs will have to be refunded, or eating the cost until SCOTUS blesses them. No sense looking for new sources until there's clarity from the courts. If the same "resilience" and import surges are happening post-SCOTUS, then it'll be something to write home about. Until then, it at best tells us that markets are in a holding pattern.